Snyder makes tax, fee proposals for road repairs in State of the State address

Thursday

Jan 17, 2013 at 11:18 AMJan 17, 2013 at 11:22 AM

By Daily Telegram staff and the Associated Press

Gov. Rick Snyder urged Michigan legislators to put aside short-term political concerns and approve tax and fee increases needed to raise an additional $1.2 billion a year to patch up Michigan's ailing roads and bridges.

Generating new money for Michigan's transportation network was the centerpiece of Snyder's third annual State of the State address, delivered Wednesday to a joint session of the state Legislature in the Capitol. The Republican governor sought support from both parties midway through a turbulent term in which he has pleased business interests but alienated Democrats and organized labor with tax relief for corporations and measures that have weakened unions' powers.

Snyder provided few details of his road plan in his nearly hourlong speech, which also touched on education, insurance reform and a variety of other issues. Instead, he focused on convincing lawmakers facing re-election campaigns next year that rebuilding the state's crumbling transportation infrastructure is important enough to risk upsetting motorists with a request to pay more for gasoline.

"We're not here for us," he told lawmakers. "It's an honor and privilege to be elected, and we're here to serve 10 million people that are counting on us. So let's get the job done."

Republicans skittish about raising taxes said they would give the governor's funding pro­- posals fair consideration, while Democrats said he was continuing to place more burdens on the middle class while giving breaks to wealthy corporations.

"I was impressed with the way he laid out the progress we've made in the past two years," state Rep. Nancy Jenkins, R-Clayton, said. "We've come a long way. He laid out an aggressive plan of action for the future."

She is taking a wait-and-see position on a transportation plan.

"It is something we really need to work on," she said. "It is a difficult issue because of the cost. Who knows where we will come up with the money? The proposal was pretty vague, but I'm anxious to see the details. It sounds like it might be similar to his proposal from last year."

State Sen. Bruce Caswell, R-Pittsford, noted the details on the transportation package have not yet been revealed, but he is hopeful of action.

In a briefing for reporters beforehand, senior policy adviser Bill Rustem said Snyder favored replacing the tax on fuels paid at the pump with a levy at the wholesale level, which could be passed on to consumers and rise with inflation. He also supports raising the annual motor vehicle registration fee and allowing local governments to increase it even further to raise money for fixing local roads, Rustem said.

"We need to invest more in our roads. ... It's time," Snyder said, arguing that while his plan would cost about $120 per vehicle, motorists would recoup most of that by having lower repair bills as highways and local roads are improved. "This is not about costing us money. It is about saving us money and building for the future."

If nothing is done to raise more cash, he said, the cost of fixing Michigan's transportation infrastructure will rise to $25 billion instead of the roughly $10 billion motorists would pay under his proposal, which he said would create 12,000 jobs and prevent 100 crash-related deaths a year.

"This is our opportunity, folks," he said. "We can decide how long we want to argue about it, how political we want to make it, or we can just use some common sense and get it done."

House Speaker Jase Bolger said Republicans declined to endorse particular measures but said the Legislature had to solve the transportation funding shortfall. "We cannot punt this to the future," he said.

Tim Greimel, recently elected as leader of the House Democratic caucus, said Snyder provided too little information about his infrastructure plan. "It's clear the governor's idea of how to pay for roads is yet further increases taxes and fees paid by middle class and working families," he said.

Michigan's retail-level motor fuels tax has been stuck since 1997 at 19 cents per gallon for gasoline and 15 cents per gallon for diesel fuel. State officials say inflation and improved fuel efficiency have steadily eroded the transportation fund's purchasing power, leading to the deterioration of Michigan roads. If nothing is done to raise more repair money, two-thirds of the roads will be in poor condition by 2020, Rustem said.

In addition, Snyder called for moving more state social workers into troubled elementary schools, reforming Michigan's no-fault auto insurance program to limit the amount of medical claims, establishing an agency to crack down on insurance fraud, improving mental health services and establishing a state agency to help military veterans obtain federal benefits.

"I was very happy to hear him talk about reforms on mental health issues," Caswell said. "This has long been a passion of mine, and we need a commonsense approach to this issue."

Michigan's schools continue to underperform, Snyder said. Fewer than one in five students are ready for college, and more than 60 percent of those going to community college need remedial courses. "That's absolutely unacceptable," he said.

He said he wanted to expand a program begun two years ago called the Education Achievement Authority, which provides resources and new learning strategies for schools with the lowest academic performance in the state. It began with 15 schools in Detroit.

Snyder didn't say how many schools should be added to the program. Rustem said a starting point for discussions with lawmakers would be a bill proposed last year that could have included up to 50. Democrats contend it weakens public schools and usurps local control.

"Over the last two years I've seen this governor and the Republican Legislature push through an agenda that picked corporate bottom lines over the education of our kids," she said.

Caswell favored the governor's proposed use of fiscal notes.

"What that means is with every bill we pass, a financial analysis is done to determine how much it will cost and where (the payment) comes from," Caswell said. "No more passing bills where we pass them now and figure out later how to pay for them. With this we will have the answers."

"I was pleased to hear that he is in charge of the Great Lakes governors and leaders conference," Caswell said. "This will give us the opportunity to talk about Great Lakes issues, such as how to keep them clean, and the Asian carp infestation and how to deal with it."

Snyder also voiced regret about the bruising legislative battles of 2012, when thousands of angry demonstrators protested the Legislature's quick approval of right-to-work measures making it illegal to require non-union workers to pay fees to the unions that negotiate their wages.

"I hope we can work together," he said, promising "to work hard to find common ground."

But the hundreds of protesters clustered near the main entrance of the Capitol weren't in a conciliatory mood. They chanted "liar" as Snyder spoke, and a banner stretched across the stone stairway read, "You can't trust Snyder."

"Every time he turns around, we're going to be there," said Mike Green, president of United Auto Workers local 652 in Lansing.